First Click, Maryland:Fact-checking Rep. Kratovil's claim on tax hike

Fact CheckIf it seems counterintuitive that a candidate would be pushing for a big tax increase as a way of winning office this election year, it is -- and, in Maryland's 1st congressional district, it's also counter to the truth.

Ads launched by Rep. Frank M. Kratovil Jr., a freshman Democrat who is seeking reelection in a close race, accuse his Republican opponent, Andy Harris, of wanting to institute a national sales tax of 23 percent on dang near everything. A similar ad also ran last month.

Like so many negative ads on both sides of the partisan divide, this one takes a kernel of truth, cranks it through the convoluted tubes of the political campaign machine, and spits out a misleading hybrid.

It's true that Harris' Web site expresses support for the revamping the tax code, perhaps by instituting the so-called Fair Tax. "I favor fairer, flatter, simpler and lower taxes -- I can support either the flat tax or the fair tax," the campaign Web site says, without going into details.

That's just fine with the Kratovil ad, which also doesn't bother to explain that the "fair tax" would replace most existing taxes, not add to them. As explained by Americans for Fair Taxation, a fair tax would take the place of taxes on personal and corporate income, capital gains, self-employment, estates and gifts. Rebates would be granted to those who met certain criteria for low-income households. Rep. John Linder (R-GA) has sponsored a bill to revamp the tax code along these lines, as did Sen. Saxby Chambliss (R-Ga). Fair tax supporters also hope to repeal the part of the 16th Amendment that first authorized the U.S. government to collect personal income tax.

Harris's press secretary Anna Nix said Harris supports the "fair tax" because he believes it would simplify and reduce Americans' tax burden, not add to it, as the attack ad implies.

But variations of the Kratovil campaign's attack ad have cropped up around the country. FactCheck.org, among other election-year umpires, has judged these ads to be misleading because they fail to explain that the national sales tax would replace most other taxes. Whether the Fair Tax would in fact be fair or wise is another matter altogether, as FactCheck.org also points out.

The idea has been around since the 1990s at least. The Kratovil campaign cites a 2004 paper by the Institute on Taxation and Economic Policy that analyzed the fair tax proposal and found that the overall effect would be to increase the tax burden on middle- and lower-income residents. In Maryland, the institute calculated that the bottom 20 percent of households would have seen their tax burden rise $3,854 a year in 2005 under a fair tax, while the richest 1 percent of households would have paid $229,114 less.

The President's Advisory Panel on Federal Tax Reform, convened by former President George W. Bush in 2005, examined the idea of a national retail tax as a possible solution to simplifying the tax code, but rejected the national retail tax largely because of its lack of progressivity. The bipartisan panel also calculated that creating and running such a tax regime, with rebates, would likely require a tax rate of at least 34 percent.

-- Fredrick Kunkle

News You Should KnowLawmaker calls for probe of MoCo College over tuition breaks for immigrants
"A Republican Maryland lawmaker urged a criminal investigation of Montgomery College on Wednesday, challenging the school's longtime practice of giving resident tuition discounts to illegal immigrants," writes The Post's Daniel de Vise. "Montgomery College allows illegal immigrants to pay the lower tuition afforded to county residents as long as they have graduated from the county's public schools. It's an unusual stance: Some public colleges in the region don't admit illegal immigrants as students, and those that do typically charge them higher non-resident rates because they cannot prove legal residency. Del. Patrick L. McDonough (R-Baltimore County) called Wednesday for state and federal prosecutors to investigate the community college's tuition policy, which he said he believes violates federal law. 'You have public officials in collusion, practicing an illegal act that costs taxpayers money,' McDonough said in an interview Tuesday. He aired his concerns publicly at a news conference Wednesday.

Is Kane being kept in the shadows?"Telling YouTube viewers that he'd found "somebody to help me turn Annapolis around," former Maryland governor Robert L. Ehrlich Jr. welcomed Mary D. Kane to his Republican gubernatorial ticket four months ago with a peck on the cheek," writes The Post's Mike DeBonis. "Since then, Kane has carried high hopes for boosting Ehrlich's bid for a return to the governor's mansion. Best known in statewide circles for her two years as Ehrlich's secretary of state and for her husband's high profile in business and Republican politics, Kane has twice waged tough election campaigns of her own - and can also boast an inspiring personal biography, rising from working-class roots and more than a decade as a full-time mother to a successful career in law, politics and business."

Column: Tap dancing around tax issues in governor's race
"When it comes to picking their next governor, Maryland voters get a clear-cut choice on the crucial issue of taxes. Unfortunately, it's over which style of campaign deception they wish to endorse," writes Post columnist Robert McCartney. "Both candidates have laid out slippery, misleading positions that avoid hard questions of how to pay the state's bills, especially for transportation and pension costs. Former Republican governor Bob Ehrlich promises to cut the state sales tax, but he won't spell out how he'd plug the resulting hole in the budget. He dodges responsibility for having supported a property tax increase when he was governor. He gives a "blanket" promise not to raise taxes if elected, but he also proposes pension changes that would probably lead to local tax increases. Gov. Martin O'Malley (D) is pushing for expensive light-rail projects in the Washington suburbs (Purple Line) and Baltimore (Red Line), but he hasn't detailed where he'd find the money. He hasn't told voters which programs he'd cut to overcome a $1 billion deficit foreseen for next year. There's a pretty good chance he'll want to raise the gasoline tax or other levies if reelected, but he won't discuss specifics while waiting to hear from a pair of commissions that conveniently issue recommendations only after voters cast ballots Nov. 2."

Campaigns show no sign of easing up on robocalls
"President Barack Obama apologizes for the bother, but he'd really like you to vote for Democratic Rep. Frank Kratovil. Former Maryland first lady Kendel Ehrlich politely asks for your support of her husband, Republican Robert. L. Ehrlich Jr. Think of it as auditory spam," writes The Baltimore Sun's Julie Bykowicz. "With less than a week to go until Election Day, robocalls are peaking. The automated voices of Gov. Martin O'Malley and Lt. Gov. Anthony G. Brown, as well as Ehrlich and running mate Mary Kane, should be familiar by now. That is, if you're answering your telephone."

Quotable

"Up or out"

Former Maryland governor Robert L. Ehrlich Jr. (R) said Wednesday that he is unlikely to run for public office again if he loses his bid to return to the governor's mansion, characterizing the election as "up or out" for him, writes The Post's John Wagner. Ehrlich, who in 2002 was elected Maryland's first Republican governor in a generation, campaigned Wednesday at Leisure World, the sprawling retirement community in Montgomery County. Following the appearance, Ehrlich was asked by reporters if he would run either for governor again or U.S. Senate if he is defeated Tuesday in his comeback bid by Gov. Martin O'Malley (D), who unseated Ehrlich in 2006. "It would be very difficult to imagine that," said Ehrlich, citing the favorable climate for Republicans nationally this year and the "full life" he has outside politics. Polls published Monday by The Washington Post and Sunday by The Baltimore Sun both showed O'Malley leading the race by 14 percentage points. Ehrlich said Wednesday that he believes the race is much closer. He said internal polling by his campaign shows O'Malley ahead by less than 3 percentage points. Aides declined to released a copy of the poll.

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For those who truly want both sides should check out http://www.fairtax.org/PDF/A_FairTax_rebuttal_to_ITEP-110706.pdf dealing with the mentioned ITEP study as well as http://www.fairtax.org/site/News2?news_iv_ctrl=-1&page=NewsArticle&id=8263 dealing with the President's Advisory Council. It is curious that even those who claim to be fair in their analysis still editorialize by adding "so called" to the Fair Tax while using critics that have been refuted/rebutted ad nauseum by the supporters of the Fair Tax. They have also yet to explain how taking a minimum of 23% in deductions from everyone's paycheck helps anyone, especially the poor, to pay their bills. In case of the poor, the income tax punishes their very efforts to improve their economic situation by taking more from them with any improvement of their income. Under the Fair Tax, that penalty is eliminated and only those who spend more are taxed more; and that certainly isn't the poor or middle class. [Hint: there's a reason the poor aren't called the rich]

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